* KAUPSKIL, A UNIT OF KAUPTHING AND THE MAJORITY OWNER OF ARION BANK, HAS DECIDED TO USE ITS PURCHASING OPTION TO BUY A 13 PERCENT STAKE IN ARION BANK OWNED BY THE STATE FOR 23.4 BILLION ICELANDIC CROWNS ($233.88 MILLION) FURTHER COMPANY COVERAGE: ($1 = 100.0500 ICELANDIC CROWNS) (Reporting by Elias Thorsson and Jacob Gronholt-Pedersen)